Expert deems offer for Cirrus ‘unreasonable’

The board of local IT services firm Cirrus Networks has continued to reject an unsolicited takeover proposal from Victoria's Webcentral Group, after an independent expert deemed the offer unfair and unreasonable.

Yesterday, Cirrus Networks released a second target statement to the ASX in response to Webcentral’s earlier proposal to buy the Perth-based firm for 3.2 cents a share.

The statement included an assessment from independent expert Lonergan Edwards, which concluded the offer was neither “fair nor reasonable” since it fell short of its assessed valuation range for Cirrus’ shares, being 3.8 cents to 4.2 cents.

Webcentral's offer values Cirrus at about $30 million.

That is a marginal 3.2 per cent premium to Cirrus' closing price a day before receiving the offer and less than its current market capitalisation of about $32 million.

The Cirrus board has continued to unanimously recommended shareholders reject the offer as well as resolutions put forward by Webcentral, including the removal of three Cirrus directors.

Paul Everingham – who has been a director of Cirrus since 2018 – is exempt from the request.

He has, however, notified shareholders of his intention to leave the company if the resolutions were passed at a meeting next month.